GTHT released a research report maintaining a "BUY" rating on MIDEA REAL EST (03990). The firm forecasts EPS of RMB 0.42/0.57/0.74 for 2025/26/27 respectively, applying a 12x PE multiple for 2025, resulting in a target price of HK$5.46. The company's core net profit doubled in H1 2025, continuing to deliver a competitive dividend policy in the industry, with development services contributing as a new growth driver. (Unless otherwise specified, all figures are denominated in RMB, with HK$1 = RMB 0.92)

GTHT's main viewpoints are as follows:

Core Net Profit Doubles, Continuing to Deliver Competitive Dividend Policy in the Industry

In the first half of 2025, the company achieved operating revenue of RMB 199.659 billion, up 41.3% year-on-year; core net profit of RMB 31.208 billion, up 119.4% year-on-year. The company's H1 2025 gross margin was 30.8%, down 3 percentage points year-on-year, mainly due to increased cost of sales; net financial income was RMB 1.163 billion, turning positive from negative year-on-year with improved financial structure, primarily due to the full repayment of all borrowings during the period, significantly reducing interest expenses.

The Board of Directors announced on August 27, 2025, an interim dividend of HK$0.15 per share to shareholders. Since listing in 2018, the company has adhered to value sharing, maintaining a competitive dividend policy in the industry for seven consecutive years, with dividend yield consistently exceeding 8%.

Business Structure Optimization, Property Management Services Breakthrough in Ten-Million-Level Projects

The company has clearly defined its future focus on four major segments: "Development Services + Property Management Services + Asset Operations + Real Estate Technology," driving synergies between businesses through resource integration. Specifically, the company's H1 2025 revenue from property management services, asset operations, real estate technology, and development services were RMB 92.999 billion, RMB 27.493 billion, RMB 28.697 billion, and RMB 50.470 billion respectively, representing year-on-year changes of +8.7%, +13.9%, -9.2%, with development services being a new business unit.

Among these, the company's H1 2025 property management services managed and contracted areas were 79.46 million square meters and 96.06 million square meters respectively, growing 5% and 4% year-on-year. The company signed 7 new non-residential projects with contracts exceeding ten million RMB, continuing to focus on industrial parks and healthcare core segments.

Development Business Contributes as New Growth Driver

Following restructuring on October 22, 2024, the company undertook full-cycle development management of the controlling shareholder's existing real estate development resources. With technology, health, and energy efficiency as guiding principles, it provides design, construction management planning and implementation, and other related supporting services.

In the first half of 2025, the company expanded around key cities (Guiyang, Wuxi, Xuzhou) with 4 third-party residential projects. The full-cycle contract amount totaled RMB 160 million. Among these, Wuxi Midea Dongwang Mansion, as the first representative work of asset-light construction and operation, achieved first-phase sales of RMB 472 million, becoming the new king of luxury property sales velocity in Wuxi, with a sell-through rate exceeding 90%, surpassing the client's expectations in both volume and price.